If the Fed wants to use "open market operations" to decrease the money supply,it would
A)increase the federal funds rate.
B)issue more federal government debt.
C)sell U.S.government securities (bonds)to the general public.
D)increase the required reserve ratio.

Question

Quizplus · Accepted Answer

Open market operations involve the buying and selling of government securities. If the Fed wants to decrease the money supply, it can sell U.S. government securities (bonds) to the general public. This reduces the amount of money in circulation, as investors use their funds to purchase the securities instead of spending or investing them elsewhere.

If the Fed Wants to Use "Open Market Operations" to Decrease